January 05, 2024

E85: $5.0b in OpenAI revenue?!, OpenAI valuation up 16% to $100b, Fidelity cuts X 71% to $12.5b, SpaceX’s satellite-to-cell launches, xAI now a benefit corp, OpenAI cutting publisher licensing deals, TikTok + Peloton partnership | Pre-IPO Stock Market Upd

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00:10 | SpaceX’s satellite-to-cell launches
- 6 Starlink satellites launched providing satellite to cell service
- Text messaging now; voice and data coming later
- T-Mobile is US partner
- In conversation now with cell providers in Australia, Switzerland, Canada, New Zealand, Chile, Peru, and Japan
- Starlink to generate $10b in 2024 revenue
- SpaceX is currently completing a tender at $180b

01:16 | Fidelity cuts X 71% to $12.5b
- Fidelity cut its X position valuation by 10.7% in Nov 2023
- Fidelity has X valuation down 71.5% since Musk’s purchase at $44b in Oct 2022
- Decline is attributed to loss of ad revenue
- X owns 25% of xAI, Musk’s large language model AI solution
- xAI is currently in market raising a round and, we believe, the xAI valuation will start to impact X’s valuation in the very near future

02:08 | xAI now a benefit corp
- xAI filed as a benefit corporation in Nov 2023
- Anthropic is also a benefit corporation
- OpenAI is a non-profit with a for-profit subsidiary
- Very interesting governance structures for very important AI companies

02:51 | $5.0b in OpenAI revenue?!
- $1.6b in annualize revenue is a 20% increase from the previously announced Oct 2023 number
- OpenAI management believes $5.0b in annualize revenue is possible by end of 2024
- Currently closing a tender at $86b and raising a primary round at $100b

03:46 | Customers diversifying AI providers
- OpenAI CEO snafu in Nov 2023 has led to customers diversifying AI providers
- Anthropic, Cohere, Hugging Face, and other stand to be beneficiaries
- OpenAI models currently appear to be deemed best in market

04:48 | OpenAI cutting publisher licensing deals
- In discussions with multiple publishers to license data
- Recently cut deals with Axel Springer (Politico, Business Insider) and The Associated Press
- The New York Times has sued OpenAI which is complicating negotiations with other publishers
- We believe NYT lawsuit is a negotiating tactic to receive better terms from OpenAI

05:52 | TikTok + Peloton partnership
- Peloton will have dedicated hub on TikTok
- Goal is to attract younger users to Peloton
- Live classes, original instructor content, celebrity collaborations
- TikTok is a division of ByteDance, the largest pre-IPO company globally
- ByteDance is in a buyback valuing the company at $268b

07:11 | Pre-IPO +0.02% for week
- Week winners: OpenAI +7.68%, ByteDance +3.12%, Brex +0.90%, Cohere +0.85%, Stripe +0.74%
- Week losers: Anthropic -6.91%, Databricks -1.88%, Discord -1.68%, Notion -1.48%, Anduril -1.13%
- Top valuations: ByteDance $193b (open buyback at $268b), SpaceX $174b (open tender at $180b), OpenAI $72b (open tender at $86b, open primary round at $100b), Stripe $54b, Databricks $46b lead in current valuation